Real-world impact of empagliflozin on total cost of care in adults with type 2 diabetes: Results from an outcomes-based agreement

BACKGROUND: Value-based health care is expanding through payment models such as outcomes-based agreements between manufacturers and payers. OBJECTIVE: To describe the total-cost-of-care outcomes of an outcomes-based agreement evaluating the real-world impact of empagliflozin vs other type 2 diabetes mellitus (T2DM) drugs among all patients with T2DM, with and without cardiovascular disease (within and beyond the requirement of the agreement). METHODS: In this prospective real-world analysis, members from the health plan of an integrated health care delivery system from the commercial and Medicare Advantage lines of business, who qualify under the confines of the contract, were included for analysis. Thus, members aged 18 years and older who were continuously enrolled in the identification (January 1, 2018, to December 31, 2018) and measurement periods (≤1 year post-index) with a T2DM diagnosis were retained. Patients using empagliflozin and empagliflozin-combination drugs constituted the empagliflozin group; those using all other antihyperglycemics, the nonempagliflozin group. Patients with type 1 diabetes, or those using metformin or insulin monotherapy, at index were excluded. Eligible members were followed for up to the earliest occurrence of disenrollment date, discontinuation (60-day medication fill gap allowed) of empagliflozin (or nonempagliflozin containing) medication, or the end of the measurement period. We compared, using Student’s t-test and summary statistics (for reporting the outcomes agreement) and a propensity-matched difference-in-difference model (for the followup evaluation beyond the requirement of the agreement), the mean all-cause total cost of care (pharmacy plus medical) per patient per month (PPPM) between the 2 groups, including a subgroup of members with a baseline cardiovascular disease diagnosis. RESULTS: There were 4,577 (3,069 and 1,508 in the commercial and Medicare) and 33,712 (15,571 and 18,141 in the commercial and Medicare) in the empagliflozin and nonempagliflozin groups, respectively. The difference in mean total cost PPPM was $75 lower for empagliflozin vs nonempagliflozin groups, driven mainly by lower medical costs in the empagliflozin group (−$465 PPPM). However, the difference was not statistically significant in the propensity score–matched model. CONCLUSIONS: Although empagliflozin had higher pharmacy costs, the total cost of care for patients with T2DM and with established cardiovascular disease were comparable to the group of patients with all other T2DM, driven mainly by lower medical costs.


OBJECTIVE:
To describe the total-cost-of-care outcomes of an outcomes-based agreement evaluating the real-world impact of empagliflozin vs other type 2 diabetes mellitus (T2DM) drugs among all patients with T2DM, with and without cardiovascular disease (within and beyond the requirement of the agreement).

METHODS:
In this prospective real-world analysis, members from the health plan of an integrated health care delivery system from the commercial and Medicare Advantage lines of business, who qualify under the confines of the contract, were included for analysis. Thus, members aged 18 years and older who were continuously enrolled in the identification (January 1, 2018, to December 31, 2018) and measurement periods (≤1 year post-index) with a T2DM diagnosis were retained. Patients using empagliflozin and empagliflozin-combination drugs constituted the empagliflozin group; those using all other antihyperglycemics, the nonempagliflozin group. Patients with type 1 diabetes, or those using metformin or insulin monotherapy, at index were excluded. Eligible members were followed for up to the earliest occurrence of disenrollment date, discontinuation (60-day medication fill gap allowed) of empagliflozin (or nonempagliflozin containing) medication, or the end of the measurement period. We compared, using Student's t-test and summary statistics (for reporting the outcomes agreement) and a propensity-matched difference-in-difference model (for the followup evaluation beyond the requirement of the agreement), the mean all-cause total cost of care (pharmacy plus medical) per patient per month (PPPM) between the 2 groups, including a subgroup of members with a baseline cardiovascular disease diagnosis.
RESULTS: There were 4,577 (3,069 and 1,508 in the commercial and Medicare) and 33,712 (15,571 and 18,141 in the commercial and Medicare) in the empagliflozin and nonempagliflozin groups, respectively. The difference in mean total cost PPPM was $75 lower for empagliflozin vs nonempagliflozin groups, driven mainly by lower medical costs in the empagliflozin group (−$465 PPPM). However, the difference was not statistically significant in the propensity score-matched model.

Plain language summary
Outcomes-based agreements occur between drug companies and payers or their agents. The goal is to provide access to newer drugs and to show their value. They are useful in comparing clinical findings with actual use of these drugs. This study looked at one such agreement based on the total costs of patients with diabetes. These costs were similar between the two groups, between those who were taking the newer medication and those who were not.

Implications for managed care pharmacy
Sodium-glucose cotransporter-2 inhibitors have been recommended for use in patients with diabetes, especially those with pre-existing cardiovascular disease, by the American Diabetes Association. In this outcomes-based agreement analysis, comparing empagliflozin to other diabetic medications real-world use, the total cost of care was comparable between the two groups. The analyses suggest that the reduced medical cost of care compensated for the higher pharmacy cost of empagliflozin.
Outcomes-based agreements (OBAs) are a form of valuebased pharmaceutical contract arrangements, in which health insurers (or often their pharmacy benefit managers) and drug manufacturers connect reimbursement to predefined clinical and/or economic outcomes. The emergence of such contracts comes from a growing demand for the health care industry to emphasize payment for value of care provided, as opposed to volume, while reducing overall costs of care. [1][2][3][4] OBAs work to create joint responsibility between health insurers and drug manufacturers through various risk-sharing models, based on the drug performance in real-world settings. As such, OBAs may provide several benefits across the health care ecosystem: (1) better patient access to new and innovative medications, which can improve patient outcomes and reduce downstream medical costs for the health care system; (2) opportunity for reduced cost-sharing and increased satisfaction for patients; (3) preferred formulary placement (depending on the outcomes) for manufacturers' products; (4) opportunity for providers and health insurers to get higher performance ratings on quality measures; and (5) increased potential rebates for health insurers if medications do not achieve the agreed on outcome targets. [5][6][7] OBAs have grown in popularity over recent years, with greater than half of publicly disclosed OBAs introduced after 2015. 2,8,9 In total, nearly 80 pharmaceutical valuebased contracts have been publicly disclosed between 2009 and 2021; 10 though the number of actual contracts is estimated to be much higher. 8 Discussion of specific OBA terms (eg, outcomes, measurements, costs), decision on outcomes to be measured, and contract results remain largely unreported, given the confidentiality of arrangements. Because of this lack of transparency, the scope of how OBAs have impacted the health care system is unknown.
To date, most reported therapeutic areas involved in OBAs have included neurology (multiple sclerosis and seizure disorders), cardiology (dyslipidemia, heart failure, antiplatelets), endocrinology (diabetes), and rare diseases. 10 Therapeutic areas such as diabetes, heart failure, and dyslipidemia are especially attractive for OBAs because prevalence for these conditions is high, and new medication classes, which are associated with significant clinical benefits, have been added.
Diabetes impacts 13% of adults (aged ≥18 years) in the United States. 11 In recent years, several new classes of diabetes medications have been added as treatment options, including sodium glucose cotransporter-2 inhibitors (SGLT2is) (first approved by the US Food and Drug Administration in 2013) 12 and glucagon-like peptide-1 receptor agonists (first approved by the US Food and Drug Administration in 2005). 13 These newer agents have demonstrated lower adverse cardiovascular events in select patient populations, 14 unlike most older diabetes medications, which lower blood glucose but have not demonstrated efficacy in other clinical outcomes such as heart attacks or strokes. However, because these newer diabetes medications are significantly more expensive than older, generic diabetes medications, 14 they have been a target for insurers and other payers to engage in OBAs with pharmaceutical manufacturers.
In 2019, a large regional health plan entered an OBA with the manufacturer of empagliflozin (brand name: Jardiance), an SGLT2i, and the outcome of interest was total cost of care. Two separate contracts were implemented for commercial and Medicare lines of business, although the OBA metrics were the same for each group. The outcome of interest was total cost of care, which included all-cause costs (see Methods for definition), measured by per patient per month (PPPM). The definition of success in the OBA was based on the results of the EMPA-REG OUTCOME trial, 15 which reported that empagliflozin was associated with a 14% decrease (hazard ratio compared with placebo) in primary composite outcome of death from cardiovascular causes, nonfatal myocardial infarction, or nonfatal stroke among adults with type 2 diabetes mellitus (T2DM) and cardiovascular disease (CVD). 16 However, unlike EMPA-REG, our OBA contracts measured the outcome (total cost of care) among diabetic patients and did not require patients to have a history of CVD or be at high risk for cardiovascular events for inclusion in the analysis. Rather, the empagliflozin group included all patients with T2DM enrolled during the contract period who took any empagliflozin-containing product, and the comparator group included any patient taking antidiabetic agents (see Methods for inclusion and exclusion criteria) during the contract period. Follow-up of both groups was for up to 12 months after the first claim for diabetes medication in the contract period. For each group, the mean PPPM for total cost of care was measured (by line of business), and an outcomes ratio was calculated as the ratio of PPPM total cost of care for empagliflozin divided by the nonempagliflozin groups. The OBA designated an increasing rebate payment based on the outcome ratio (<1; ≥1 and <1.05; ≥1.05 and <1.10; and ≥1.10). No payment was due for an outcome ratio less than 1; for other outcome CONCLUSIONS: Although empagliflozin had higher pharmacy costs, the total cost of care for patients with T2DM and with established cardiovascular disease were comparable to the group of patients with all other T2DM, driven mainly by lower medical costs.
date for an antihyperglycemic was defined as the index date ( Figure 1). Patients with an index claim for empagliflozin and/or empagliflozin-combination drugs constituted the empagliflozin group, and those with index claim for all other antihyperglycemics defined the nonempagliflozin group. Note that nonempagliflozin SGLT2i medications were allowed in the nonempagliflozin group. Patients with type 1 diabetes evidence during the 12-month pre-index period and those prescribed metformin or insulin monotherapy at index for the nonempagliflozin group were excluded ( Figure 2). Eligible members were followed for up to a maximum of 12 months post-index date; this duration was determined by the earliest occurrence of date of plan disenrollment, date of discontinuation (60-day medication fill gap allowed) of empagliflozin-(or nonempagliflozin) containing medication, or initiation date of claim of empagliflozincontaining medication (for the nonempagliflozin group only). All-cause total cost of care included both plan reimbursement (pharmacy and medical) and patient payments (copays, deductibles, and coinsurance). Costs data are often skewed to the right, and the OBA required outliers to be removed, as they could negatively influence the outcomes. Methods often used include Winsorization, cook distance, and boxplot. 17 The OBA contract, however, required the top 1% of each group (empagliflozin and nonempagliflozin, separately) with the highest cost to be eliminated from the analysis. For the follow-up analysis, we included the top 1% prior to propensity matching.
We compared the mean all-cause total cost of care PPPM between the 2 groups, including the subgroup of patients with a prior CVD diagnosis, using Student's t-test. For confidentiality, we report mean PPPM cost differences and not the ratios, as required by the contract. We defined CVD as cardiovascular, ischemic, and circulatory system diseases with ICD-10-CM codes such as I25.10 and I48.91. 18 Because ratios, the rebate payment increased as the ratio increased (actual payment amounts are confidential). In addition to the calculation of an outcome ratio for all patients with diabetes (as defined above), the contract required doing the same comparison, limited to patients with a history of CVD (similar to EMPA-REG OUTCOME trial). However, no rebate was associated with these outcomes in patients with T2DM and CVD.
In this article, we describe the results of this empagliflozin OBA, which compared the total cost of care PPPM between the empagliflozin and nonempagliflozin groups in a real-world setting (within the confines of the agreement [OBA model] and a follow-up analysis that controlled for confounders [propensity-matched model]), from the health care payer perspective. Manufacturers, health insurers, and managed care practitioners may find this study useful in designing future OBAs and assessing the benefit of OBAs, as well as the value proposition of newer and more costly pharmaceuticals.

Methods
In this prospective real-world analysis, the health plan of an integrated health care delivery system compared the total cost of care of a group of members receiving empagliflozin vs non empagliflozin, identified per the OBA. Inclusion in this study was dictated by the requirements of the OBA. The groups consisted of commercial and Medicare Advantage (Medicare) insurance members aged 18 years and older with T2DM (International Classification of Diseases, Tenth Revision, Clinical Modification [ICD-10-CM] code E11*). The groups were identified between January 01, 2018, and December 31, 2018. All study participants were required to be enrolled with at least 1 month medical and pharmacy benefits post-index fill, in which the first prescription fill  Study Design 2 groups (1:2) and using a difference-in-difference (D-in-D) model (repeated-measures analysis of variance) to assess the difference in mean total cost of care by adjusting for demographics (age, sex, insurance type, race, Charlson Comorbidity Index (CCI), hypertension, and number of antidiabetic medications pre-index) and baseline costs (12 months pre-index all-cause total cost of care PPPM).
the OBA is based on an outcomes ratio, and because actual costs cannot be shared because of the proprietary nature of cost data, we only report differences in costs (pharmacy, medical, and total cost of care. The OBA did not require any matching of cohorts (demographic or clinical characteristics). However, we performed additional analyses beyond the requirements of the OBA by propensity matching the  TABLE 1 the empagliflozin and 52% in the nonempagliflozin groups) ( Table 1). The mean CCI was higher in the nonempagliflozin group (4.2 vs 3.3). The top 4 diabetes medication classes in the pre-index period in the nonempagliflozin cohorts were sulfonylureas (26%), insulin/insulin combinations (25%), metformin (18%), and dipeptidyl peptidase-4 inhibitors (10%) and in the empagliflozin group were metformin (29%), SGLT2s (22%), sulfonylureas (14%), and insulin/insulin combinations (11%) ( Table 1). These do not add up to 100% because the denominator consisted of patients who could be receiving more than 1 of these medications. The average follow-up periods among the Medicare group were higher in the nonempagliflozin cohort (commercial 9.7 months; Medicare 10.4 months) than in the empagliflozin cohort (commercial 9.0 months; Medicare 8.3 months). Baseline mean pharmacy cost was higher in the empagliflozin cohort by $168 PPPM but was higher by $100 PPPM among those new to empagliflozin (Table 1).

OBA MODEL RESULTS
There were 4,577 (3,069 and 1,508 with commercial and Medicare coverage) and 33,712 (15,571 and 18,141 with commercial and Medicare coverage) members in the empagliflozin and nonempagliflozin groups, respectively, in the OBA model ( Figure 2). In the overall group, the mean age was higher in the nonempagliflozin at 63.9 years (SD ± 12) than the empagliflozin group, 59.3 years (SD± 10) (Table 1). However, the mean ages were similar among the commercial population (empagliflozin: 55.6 [SD ± 8.3] vs nonempagliflozin 55.8 [SD ± 9.3] years) but higher in the nonempagliflozin group (70.9 [SD ± 9.9] years) vs the empagliflozin group (66.7 [SD ± 9.4] years) in the Medicare population (Supplementary Table 1, available in online article). More than three-quarters in both groups were identified as White, and there were more male participants than female participants in both groups (60% in

All
Commercial Medicare cohorts after the match. In the main D-in-D model, the difference in PPPM for the total cost of care in the adjusted model was −$580 (pre-post) for the empagliflozin group and $534 (pre-post) for the nonempagliflozin group, and the difference of the differences (−$45) was not statistically significant (P = 0.6174). The D-in-D for the CVD subgroup was +$271, meaning the difference in PPPM (pre-post) was lower in the empagliflozin group (−$1,166) than in the nonempagliflozin group (−$1,437), but it was also not statistically significant (P = 0.179) (Figure 4).

Discussion
The objectives of these analyses were to describe the findings of an OBA that compared total cost of care of empagliflozin with nonempagliflozin cohorts among patients aged 18 years and older with T2DM within the requirements of the OBA and to describe findings when the 2 groups are propensity matched to reduce confounding. Overall, total PPPM cost of care of the empagliflozin group was lower in the OBA model but comparable to those of the group of other nonempagliflozin medications in the propensity-matched model. Although empagliflozin total pharmacy cost was higher, this was offset by a lower total medical cost in the empagliflozin cohort. Results of the EMPA-REG OUTCOME trial 16 formed the basis for this OBA. In that trial, empagliflozin was evaluated in a patient population with established or high risk for CVD and was shown to reduce cardiovascular events compared with placebo (standard of care). Because hospitalization is the leading factor in the total cost of care, it is not surprising that the comparable total cost of care in our study was achieved through reduction in medical cost of care. In the EMPA-REG OUTCOME trial, the relative risk reduction of hospitalization for heart failure was 35% for patients with T2DM at risk of cardiovascular adverse events. 16 Our findings align with a recently published study that compared empagliflozin vs nonempagliflozin among T2DM patients with CVD-related utilization claims. In that study, the mean difference in total cost of care was $412 PPPM (vs $339 PPPM in our OBA model) in favor of empagliflozin, driven mainly by reduction in all-cause medical costs of $400 PPPM (vs $805 PPPM in the OBA model). 15 Additionally, a recent white paper on findings of an empagliflozin OBA of a health plan involving members with T2DM and a coexisting cardiovascular risk found a 20% total-cost-of-care savings driven by a 30% reduction in medical cost. 15 When considering all patients, including the baseline cost of care, the economic benefit of empagliflozin is mitigated by greater pharmacy costs; however, lower total cost of care can be substantial when limiting the analysis to patients who were The difference in mean total cost of care PPPM was $75 lower for empagliflozin than for the nonempagliflozin groups, driven mainly by lower medical costs in the empagliflozin cohort (difference: −$465 PPPM), although pharmacy costs were higher (difference: +$390 PPPM) ( Figure 3). The pattern was similar in both commercial and Medicare populations, but the offset between lower medical cost and prescription cost was higher among the Medicare cohort. In a sensitivity analysis (inclusive of the top 1%), the total cost of care was $475 (vs $75) lower for the empagliflozin group than for the nonempagliflozin group. Similarly, for a subcohort of patients with CVD, the mean total cost of care PPPM was $339 lower for empagliflozin than for the nonempagliflozin cohorts, with the medical cost savings (difference: −$805 PPPM) in the empagliflozin cohort offsetting the increased pharmacy costs (difference: +$466 PPPM) (Figure 3). Compared with the total cohort, the cardiovascular cohort members were older, had higher CCI scores, and a higher proportion of hypertension diagnosis (Table 1).

PROPENSITY-MATCHED MODEL RESULTS
In the 1:2 match, there were 4,514 and 9,028 patients in the empagliflozin and nonempagliflozin cohorts, respectively. Similarly, in the subgroup of patients with CVDs, there were 1,501 and 3,002 patients (Supplementary Table 2). There were no statistically significant differences between the 2 groups were not randomly selected and therefore could have significant differences beyond the observable variables even in the propensitymatched groups. Additionally, we used administrative datasets, which are known to be subject to miscoding and lacking record of cash claims. Finally, our inability to report outcome ratios, rebate payments (if any) or actual mean PPPM may reduce the utility of our findings to some organizations. However, the strength of the design is that it allowed assessment of the real-world use of T2DM medications within a large regional health plan with access to both medical and pharmacy costs.

Conclusions
We report the details and outcomes from an OBA that focused on use of empagliflozin in a real-world population with T2DM. Our findings suggest that the PPPM total cost of care of patients receiving empagliflozin was similar to PPPM total cost of care of patients receiving nonempagliflozin antidiabetic medications. Adjusting for differences between populations and limiting the populations to those with a history of CVD did not change our findings. The use of empagliflozin, an SGLT2i, could therefore lead to lower medical cost for patients with T2DM, leading to cost neutrality in total cost of care. There are few publicly available reports of results of OBAs despite the ubiquity of these types of payment arrangements; we encourage others to report OBA outcomes.

DISCLOSURES
The authors report no conflicts of interest beyond being employees of the 2 organizations involved in this outcomes-based agreement. Ms. Palli is a former employee of Boehringer Ingelheim Pharmaceuticals, Inc., who was affiliated at the time of study conduct.
new to empagliflozin and preexisting CVD diagnosis. In that subgroup, the total cost of care decreased by almost $700 PPPM, driven by a $987 PPPM (pre-index medical cost +$182; postindex medical cost difference −$805) ( Table 1 and Figure 3) reduction in medical care. These differences we found in the OBA were similar to the findings when the cohorts were matched and adjusted, although the difference in total cost of care PPPM was not statistically significant. These suggest that although total prescription cost of empagliflozin was higher than the total prescriptions costs in the nonempagliflozin group, the lower medical cost in the empagliflozin group made the total cost of care PPPM cost neutral.
SGLT2i medications have been recommended by the American Diabetes Association for use in patients with T2DM and established atherosclerotic CVD (especially those at risk of heart failure or if heart failure coexists), or those in whom a chronic kidney disease coexists, following demonstrated benefit in clinical trials. 19 Likely, as a consequence of clinical benefits, use of SGLT2is in T2DM in the United States is increasing. A recent publication examining T2DM medication trends estimated an increase in use among patients from 2.5% in 2014 to 7.6% in 2019. 20 Another study that assessed the impact of switching from dipeptidyl peptidase-4 inhibitors to either SGLT2is or glucagon-like peptide-1 receptor agonist medications found patients who switched had a reduction in all-cause hospitalizations, further strengthening the value of SGLT2is in reducing medical cost of care. 21

LIMITATIONS
This is an observational study subject to selection bias, so we do not claim causality. Specifically, the 2 study